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Enforcement Director Praises SEC Whistleblower Program, Urges Whistleblowers to Report to the SEC as Soon as they Learn of Misconduct

The SEC’s Director of Enforcement, Andrew Ceresney, recently gave a speech directed to SEC whistleblowers and SEC whistleblower attorneys.  During his speech, the Director praised the successful early years of the SEC whistleblower program and provided some guidance to potential SEC whistleblowers and SEC whistleblower attorneys.

Praise for the SEC Whistleblower Award Program

Mr. Ceresney began his speech by declaring that “I cannot overstate the appreciation we have for the willingness of whistleblowers to come forward with evidence of potential securities law violations.  I often speak of the transformative impact that the program has had on the Agency”.  He concluded his speech by stating that he anticipates “that the whistleblower program will continue to be a game changer in future years.  In fact, my prediction is that it will take us significantly less time to announce that we have passed the $200 million milestone [for awards given out] than it did to pass the $100 million mark.”

The SEC Whistleblower Program is growing, with more and more people choosing to come forward and report securities crimes and violations to the SEC.  According to Mr. Ceresney, in 2015 the SEC saw an increase in whistleblower tips of 30% over fiscal year 2012, and added that “we are on target to exceed that level this year.”

He also chose to mention three broad “classes” or types of cases that have seen double-digit increases in tips reported to the SEC by whistleblowers.  After each one, he specifically stated that the SEC hopes these whistleblower reporting trends will continue.

Urging Potential Whistleblowers to Report to the SEC as Soon as they Learn of Misconduct

One important message that Mr. Ceresney emphasized to potential SEC whistleblowers “is to report as soon as you learn of misconduct”.  Some of the reasons he gave for this were “you never know whether someone else will report, whether the information will become stale, or whether the statute of limitations will run.  Coming forward without delay also helps prevent misconduct from continuing unabated while investors suffer more harm.”

Moreover, “Unreasonable delay in the reporting of information to us is a significant factor the Commission considers in determining the amount of a whistleblower award.”  According to Mr. Ceresney, “approximately 20% of the awards made through 2015 were reduced because of an unreasonable reporting delay.”

The Importance of SEC Whistleblower Attorneys

Mr. Ceresney also commended the involvement of SEC whistleblower attorneys and explained some of the ways that the Commission finds their involvement to be helpful.  To my knowledge, this is the first time that a senior SEC official has publicly expressed views specifically about the role and significance of SEC whistleblower attorneys.

According to Mr. Ceresney, “we welcome the involvement of” SEC whistleblower lawyers.  Experienced SEC whistleblower lawyers “can help with up-front triage of tips to identify those that have a nexus with the federal securities laws and that may have merit.”  Furthermore, experienced SEC whistleblower lawyers “can work with whistleblowers going forward to identify information that will be important to us and that will allow us to advance our investigations.”

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About the Pickholz Law Offices LLC

The Pickholz Law Offices LLC is a law firm that focuses on representing clients involved with investigations conducted by the U.S. Securities and Exchange Commission, FINRA, and other securities regulators.

The Pickholz Law Offices has represented employees, officers, and others in SEC whistleblower cases involving financial institutions and public companies listed in the Fortune Top 10, Top 20, Top 50, Top 100, Top 500, and the Forbes Global 2000. We were the first law firm ever to win an SEC whistleblower award for a client on appeal to the full Commission in Washington. Inside Counsel magazine named this achievement one of the five key events of the SEC whistleblower program. Examples of the Firm’s SEC whistleblower cases are available here.

In addition to representing SEC whistleblowers, since 1995 the Firm’s founder, Jason R. Pickholz, has also represented many clients in securities enforcement investigations conducted by the SEC, FINRA, the U.S. Department of Justice and US Attorney’s Offices, State authorities, and more. Examples of some of the many securities enforcement cases that Mr. Pickholz has been involved with are available here.

You can see what actual clients have had to say about The Pickholz Law Offices by going to the Client Reviews page on our website or by clicking here.

How to Contact the Pickholz Law Offices LLC

If you would like to speak with a securities lawyer or SEC whistleblower attorney, please feel free to call Jason R. Pickholz at 347-746-1222.

The Pickholz Law Offices remains open and will be fully operational through teleworking while we all grapple with this terrible pandemic. We hope that all of our clients, colleagues, friends, and their families remain safe and healthy. Our thoughts and prayers go out to everyone who has been affected by COVID-19.

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The Pickholz Law Offices represents U.S. and international clients in securities and white collar cases. The Firm has helped whistleblowers report frauds to the SEC, CFTC, and IRS, and has defended clients in investigations by the SEC, CFTC, DOJ, FINRA, and other financial and securities enforcement regulators.

The Firm’s founder, Jason Pickholz, is the author of the two-volume book Securities Crimes, has appeared on tv and radio, and has taught continuing legal education courses. A former BigLaw partner, he has been representing clients in financial and securities fraud cases since 1995. In recognition of his many achievements, Mr. Pickholz was elected by his legal peers to be a Fellow of The New York Bar Foundation, an honor limited to just 1% of all attorneys in the New York State Bar Association.

Mr. Pickholz has been counsel in many high-profile cases. He was the first attorney ever to win an SEC whistleblower award on appeal to the Commission, which Inside Counsel magazine called one of the five key events in the history of the SEC whistleblower program. On the defense side, Mr. Pickholz has defended clients in the SEC’s COVID-19 investigations, the CFTC’s cryptocurrency cases, and a former US Senator, among others.

If you want to speak with a CFTC, IRS, or SEC whistleblower lawyer, or with a white collar defense lawyer, you can call the Firm at 347-746-1222.

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